Global oil prices remain above US$100 a barrel as the Middle East conflict creates a new problem for energy markets: there may be enough crude available, but increasingly limited capacity to transport it.
Shipping through the Strait of Hormuz has recovered substantially from earlier disruptions, yet attacks on vessels and longer voyages are placing severe pressure on the global tanker fleet.
JPMorgan estimates Middle Eastern crude exports now require dozens of additional very large crude carriers, Suezmax and Aframax vessels compared with normal conditions.
Longer routes, ship-to-ship transfers and security-related delays mean tankers are completing fewer journeys even as crude production remains available.
The result is higher freight costs being incorporated into delivered oil prices.
Goldman Sachs estimates geopolitical risk added around US$22 a barrel to oil prices during September, the second-highest monthly risk premium in its model.
The development matters directly for Australia.
Higher global oil and diesel prices feed into petrol, transport, mining and agricultural costs, potentially keeping inflation elevated just as the Reserve Bank attempts to slow price growth.
Australian miners are particularly exposed because diesel represents a significant operating expense for open-pit mines and haulage fleets.
The oil market has therefore shifted from worrying primarily about whether the Middle East can produce enough crude to whether the global shipping system can reliably move that oil to customers.
